Q1 Financial Reports

For the Three Months Ended December 31, 2021

Prepared for:

Honorable Mayor and City Council


City Manager

Marty K. Lawing


Department Directors


Prepared by:

Budget Office

February 25, 2022

The accompanying report reflects the City’s overall financial position through December 31, 2021.


To view Funds click on the titles: Other Items:


The General Fund Revenues and Expenditures are shown below.


*Please note: Due to rounding, some totals in the narrative may be off in comparison to the graphs.

General Fund Revenues

General Fund Revenues for the three months ended December 31, 2021, total $82.50 million and are 58% of the $142.41 million dollar budget compared to prior year revenues at $69.51 million, and 52% of the $133.83 million dollar budget. This amounts to an increase in total revenues over prior year of $12.98 million dollars, or 18.7%.


The main drivers to this result consist of the following:


Increases Decreases

Ad valorem taxes $5,404,363 Payment in lieu of taxes ($117,050)

Fire assessment fee $6,534,025 Licenses and permit fees ($125,000)

Licenses and permit fees $469,330

½ cent sales tax $511,372

Total Increases $12,919,090 Total Decreases ($242,050)


After updating the calls for service study, the fire assessment fee was increased among the property categories to recover more of the fire rescue costs.


It is important to note that many major revenues, including the half-cent sales tax, communications service tax and the FPL franchise fee, reflect only two months of actual collections and one month of estimates for this three-month reporting period.

General Fund Expenditures

Total expenditures of $42.33 million are 30% of the $142.41 million dollar budget compared to the prior year expenditures of $38.56 million at 29% of the $133.83 million dollar budget.


Operating expenditures are $29.15 million and 24% of the $121.95 million budget compared to prior year of $25.78 million at 23% of the $114.17 million dollar budget.


Operating expenditures increase over the prior year by $3.76 million dollars or 9.8%, due to the net effect of the following:

  • Fire Department expenditures increase $2.77 million dollars due to the addition of 32 positions, operating supplies for bunker gear, uniforms, etc. and equipment
  • Police Department expenditures increase $603,920 due to the net effect of increases in Personal Services for workers’ compensation and the transfer of 13 officers from the COPS grant, Contract Services for the True Blue Campaign and ITS charges partially offset by a decrease in Fleet charges
  • Facilities Maintenance expenditures increase $134,454 due to a one-time chiller replacement expense at the Sidney & Berne Davis Center

Areas of concern with operating expenditures are higher than projected costs to maintain the stadium grounds and facilities as well personnel costs, as without new contracts in place for Police and General Unions, no salary increases were provided during the first quarter of the fiscal year. The Fire Union employees were the only exception since there is a contract in place.


Other expenditures increase over the prior year by $388,673 due to the net effect of the following:

  • Debt service transfers increase by $75,831;
  • Operating transfers increase $342,967 due to the following:

o $438,217 increase in transfers to the CRA Tax Increment

o $73,575 increase in the transfer to the Skatium

o ($64,275) decrease in the transfer to the Street Maintenance Fund

o ($104,550) decrease in the transfer to the Golf Courses


Overall, for the three months ended December 31, 2021, General Fund revenues exceed expenditures by $40.17 million. This result is normal since the majority of property taxes and the fire assessment fee are collected in the first half of the year.

CONCLUSION

Review and analysis of the City’s financial statements for the three months ended December 31, 2021 indicate that revenue collections are coming in as planned and spending is within the budget parameters for the major operating funds. Much of the favorability in spending is due to no salary increases provided for employees, with the exception of the Fire Union, due to contracts not in place. Monitoring of the City’s finances will continue as the fiscal year progresses.


As a reminder, the FY 2022 General Fund budget was adopted with expenditures exceeding revenues by $5.0 million. This unstructured budget position uses available reserves to fill in the gap. Budget execution trends makes it unlikely that all planned use of reserves will be necessary. However, sustainability into the future will require preservation of reserves and a structurally balanced budget. This will be the focus as the development of the FY2023 budget begins over the course of the next few months.


This report is designed as an informative document for internal use only. It does not include all funds and accounts included in the City of Fort Myers operations. All audited funds and accounts are included in the City’s Annual Comprehensive Financial Report, which for the year ended September 30, 2021, will be available by the end of March 2022.